Oil companies will not suffer: PM

New Delhi, May 22 (IANS) With global fuel prices touching record highs, Prime Minister Manmohan Singh Thursday said state-run oil marketing firms will not be allowed to suffer. “I will not allow oil companies to suffer,” he told reporters on the sidelines of a function to mark four years of the United Progressive Alliance (UPA) government.

The benchmark New York light sweet crude rose to a high of $135.09 per barrel, before climbing down. It had first gone through the $130 barrier Wednesday.

The government has been under pressure from oil marketing majors to increase prices, as they sell petrol and petro products to Indian consumers at subsidised rates, leading to massive losses of about Rs.4.5 billion per day.

The petroleum and natural gas ministry had sought the issue of oil bonds worth Rs.440 billion, amounting to 57.1 percent of the Rs.770 billion losses incurred by the state-run oil marketing companies during 2007-08. But, the finance ministry has rejected this proposal.

The government currently issues bonds for 42.7 percent of the oil firms’ losses, with another 33 percent coming from upstream oil companies.